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Alternative investments

Mirae Asset to launch $900 mn US logistics fund

Apr 29, 2021 (Gmt+09:00)

(Source: Getty Images Bank)
(Source: Getty Images Bank)

Mirae Asset Global Investments Co. is set to launch a 1 trillion won ($900 million) blind pool fund to invest in US logistics facilities, into which the South Korean investment firm's sister companies will inject 500 billion won.

Mirae Asset has recently signed a memorandum of understanding with Korean pension and savings funds to raise the other half of the fund, according to a report from the Maeil Business Newspaper. Mirae confirmed the report on Apr. 29.

The fund, dubbed Mirae Asset Maps Global II, will target warehouses in the west and east coasts of the US. It has already snapped up logistics facilities in five cities, including Boston, Washington DC and San Francisco, for 500 billion-600 billion won.

With a combined leasable area of 112,000 square meters, the facilities are under a 10-to 20-year agreement with the US delivery firm FedEx and retailers such as Watsons and Foot Locker.

The blind pool fund will expand its portfolio with additional investments in five logistics centers by 2022 for a total of 2.5 trillion-3 trillion won, half of which will be financed through loans. It is aiming for a 10% internal rate of return per annum, including expected capital gains on future exits, according to the daily.

Mirae Asset has been diversifying alternative investments into logistics centers and hospitals away from hotels and office buildings hard hit by the global pandemic.

Its first global real estate blind pool fund, Mirae Asset Maps Global I, had focused on office buildings, hotels and logistics centers since it raised 450 billion won in 2016. The fund generated a 35% gross rate of return in three years.

Last year, Mirae Asset acquired three logistics centers leased to the US online retailer Amazon for 200 billion won and a FedEx-leased facility in Indianapolis for 220 billion won. 

Driven by rapid e-commerce growth, competition is heating up to invest in prime logistics assets leased to retailers and delivery services firms with high credit ratings. Last year, Korean asset managers acquired pre-completed logistics centers in the US under a long-term agreement with Amazon.

Write to Sang-eun Lucia Lee at selee@hankyung.com

Yeonhee Kim edited this article.

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